24/01/2012 - 15:19

Lynas announces $US225m raising plan

24/01/2012 - 15:19

Bookmark

Save articles for future reference.

Lynas Corporation has announced $US225 million capital raising to complete the construction and commissioning of its rare earths processing plant in Malaysia, after revealing delays had added up to $100 million to the project’s cost.

Lynas said today it had executed binding documentation for a $US225 million unsecured convertible bonds issue.

The miner said the bonds were being subscribed by funds managed by US-based investment firm Mount Kellett Capital Management, which will also subscribe for $US50 million.

The bonds, priced at $1.25 per ordinary share, have a 4.5 year term and a 2.75 per cent per annum coupon.

“Lynas is very pleased to accept this offer to cover our working capital needs and completion of Phase 1 in Malaysia,” executive chairman Nicholas Curtis said.

“Because of its longer term and cheaper cost, the convertible bonds provide more attractive financing for Lynas than the unused working capital facility.

“Moreover it represents a further strong vote of confidence in our project.”

Lynas also announced that additional engineering completion requirements and procurement issues, as well as the recent monsoon season, were the primary causes for delays in the first phase of construction of its Malaysian plant.

The delays are expected to add between $90 million and $100 million to the cost of the project.

Lynas shares last traded at $1.28.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options